MEMPHIS (February 4, 2021) – With many institutional food buyers, including universities, restaurants and hotels, closed or at reduced capacity due to COVID-19, the nation’s food supply chain is still adapting to lower demand. As a result, small and mid-size farmers, especially specialty crop farmers, are struggling to expand their market opportunities. Greater tools are needed to ensure flexibility in the food supply chain during major crises to ensure economic security for farmers and food security for consumers. The Foundation for Food & Agriculture Research (FFAR) is awarding $2 million to establish a multi-organization collaboration, the Open Market Consortium (OMC), to develop and pilot an open-source, public-access blockchain system to connect small and mid-size farmers to institutional buyers. OMC, led by AgLaunch Initiative, includes matching funds from founding members Mississippi State University, The Seam, Tennessee State University, and the Wallace Center at Winrock International, with additional matching funds provided by the Tennessee Department of Agriculture for a total $4 million investment.
The disconnect between farmers’ supply and institutional buyers’ demand is problematic for small and mid-size farmers who lack the liquidity to bear the risk of increasing specialty crop production. For the past decade, consumer demand for local specialty crops has created unique economic opportunities for small and mid-size farmers. Yet, new technologies are needed to increase institutional purchasing of these local foods. OMC is building a decentralized, specialty crops market-developing tool, the Open Market Platform, that connects specialty crop farmers with food companies and institutional buyers.
“OMC addresses the needs of farmers for a traceable and secure supply back-end system for diverse agricultural crops while bringing more pricing transparency to attributes related to nutrition, taste, origin or other characteristics,” said AgLaunch Executive Director Pete Nelson.
OMC is analyzing the barriers to mutually beneficial contractual relationships between sellers and buyers and developing innovative crop assessment tools for supply chain participants. The Open Market Platform builds on and complements other initiatives underway through the land grant university system, private companies and the US Department of Agriculture. Designed with transparency and traceability at its core, the platform equips farmers with real-time tools and metrics to break into new markets. This innovative platform is intended to drive broad adoption, lower barriers to entry and promote peer-to-peer transactions using smart contracts. These contracts rely on blockchain technology, which allows for decentralized, transparent historical records of assets. Institutional buyers using the platform can transact securely and efficiently while supporting resilient, community-driven, regional agriculture and facilitating price transparency for non-commodity crops.
This two-year program is already piloting a prototype version of the technology in Tennessee through the AgLaunch Farmer Network, while coordinating with farmers and local food aggregators across the Mississippi Delta region to connect regional farmers with institutional buyers.
OMC’s research and platform, powered by The Seam, creates new supply and demand opportunities, shoring up the food supply chain. This Consortium further protects farmers, institutions and consumers during the COVID-19 pandemic and future food system disruptions.
Foundation for Food & Agriculture Research
The Foundation for Food & Agriculture Research (FFAR) builds public-private partnerships to fund bold research addressing big food and agriculture challenges. FFAR was established in the 2014 Farm Bill to increase public agriculture research investments, fill knowledge gaps and complement USDA’s research agenda. FFAR’s model matches federal funding from Congress with private funding, delivering a powerful return on taxpayer investment. Through collaboration and partnerships, FFAR advances actionable science benefiting farmers, consumers and the environment.
Connect: @FoundationFAR | @RockTalking
AgLaunch is revolutionizing the way that innovations in agriculture and food are brought to market by bridging the present and future to grow a more diverse and sustainable farm economy and provide healthy food for all. AgLaunch leverages its distributed network of farm incubators, entrepreneurial farmers, aligned capital partners, research consortia, technical consulting, and best-in-class accelerator programming to effectively challenge the status quo and thoughtfully create value for farmers and the communities they serve. The AgLaunch vision is to transform regional agriculture and food economy centered around farmers, innovation, and prosperity.
Connect: @AgLaunch | @AgLaunchPete
Mississippi State University
The Department of Agricultural Economics at Mississippi State University is committed to improving the economic well-being of the citizens of the state, nation, and world by providing educational opportunities and scholarship-based knowledge to encourage life-long learning and economic decision skills related to agriculture, natural resources, and community development. We believe individual responsibility, accountability, freedom of expression, objectivity, integrity, and professionalism are the key ingredients of a departmental culture that provides innovative solutions to the economic challenges facing the people of Mississippi and our nation.
Connect: @MsStateAgEcon | @ajcollart | Facebook: agecon.msstate.edu
Based in Memphis, Tennessee, The Seam was founded by leading global agribusiness companies and specializes in food and agriculture software solutions and commodity trading. In December 2000, it began operating the world’s first online exchange for cotton trading. Since that time, the company has leveraged its trading and agriculture technology expertise to expand software services into other crops, including peanuts, soybeans, grains and dairy. As a proven leader in agtech, The Seam has cleared or processed nearly $10 billion through its platforms. For more information, visit www.theseam.com.
Connect: @TheSeam | @MarkPryor
Tennessee State University
Tennessee State University (TSU) is a comprehensive 1890 Land-Grant University located in Nashville, Tennessee. The TSU College of Agriculture, in the land-grant tradition, undertakes teaching, research and extension activities. Through the Institute of Agricultural and Environmental Research (IAGER), the goal of agriculture research at TSU is to create and communicate new knowledge in the agricultural and environmental sciences. Through our innovative research, we address the needs of humankind, focusing on finding solutions to challenges faced by socially and economically disadvantaged groups, and contributing to the prosperity of the citizens of Tennessee, the nation, and the global society. For more information, visit www.tnstate.edu.
The Wallace Center
The Wallace Center at Winrock International is a national non-profit whose mission is to bring together diverse people and ideas to co-create solutions that build healthy farms, equitable economies and a resilient food system. The Center’s work focuses on five levers for food systems change – catalytic systems leadership, equity and justice in farming and food systems, learning, collaboration and innovation across communities, values-based supply chains, and regenerative land use. Our suite of programs and projects is collaboratively implemented by two teams – Resilient Agriculture and Ecosystems and Food Systems Leadership. To find out more please visit www.wallacecenter.org.